Introduction: the gender gap in salary negotiations

The persistent issue

Despite numerous calls to address gender inequalities in negotiations, women often ask for, and even intend to ask for, less than men. This disparity is not only prevalent but also starts early and has a compounding effect over the course of women's careers. The current research focused on this gender gap in negotiation behavior, which is a potential mechanism behind the persistent gender gap in labor market outcomes.

The power of status position

The researchers explored the influence of status position - one’s ranked order in a status hierarchy -  in salary negotiations. They hypothesized and found that a simple intervention, such as a reminder of women's inferior position in salary negotiations, can influence the salary requests that women and men intend to make. The study tested these interventions using survey experiments on both business school students and gig workers, providing unique insight into the psychological motivations inherent to status competition.

Methodology: survey experiments and interventions

The design

The research used a difference-in-differences (DID) experimental design on a sample of business school students and gig workers. The participants were shown information about a stable or closing gender gap in historical intended salary requests from similar individuals. The researchers hypothesized that any reminder of the gender gap would lead women to intend to request more compared to the control groups.

The findings

The study found that any reminder of the gender gap led women to intend to request more compared to the control groups. Interestingly, showing a stable gap without female progress caused men in a business school to request less than men in a control condition. However, men requested relatively more when shown a closing gap compared to the stable gap condition.

Conclusion: the promise and peril of simple interventions

The study points to the promise of simple interventions designed to reduce gender gaps in intended salary requests. However, it also highlights the perils arising from competitive dynamics as women approach parity. As women's status improves, men may respond by requesting higher salaries, potentially exacerbating the gender gap. Thus, the research underscores the complexity of addressing gender inequality and the need for nuanced strategies that consider the dynamics of status competition.

Meet the researchers

This groundbreaking study is the result of a collaborative effort by a team of researchers from the Stockholm School of Economics:

• Emelie Fröberg, House of Innovation, Stockholm School of Economics
  
• Jenny Säve-Söderbergh, The Swedish Institute for Social Research, Stockholm University
• Richard Wahlund, Department of Marketing and Strategy, Stockholm School of Economics
• S. Wiley Wakeman, Department of Management and Organisation, Stockholm School of Economics